A tractable model of process fairness under risk

This paper proposes a social utility model of individual preferences for process fairness that complements the Fehr–Schmidt model for outcome fairness. The model assumes that the outcome generating process rather than the actual outcomes influences fairness perceptions, and that process fairness is evaluated through comparison of expected payoffs. The process model successfully predicts data from bargaining games involving risky payoffs that neither outcome-based nor reciprocity models can explain. In a theoretical application, Machina’s parental example for non-expected utility in a distributional problem (Machina’s Mom) is analyzed by incorporating individual level process fairness preferences under expected utility.     

The Leader as the Face of a Crisis: Philip Morris' CEO's Speeches During the 1990s

This research investigated Philip Morris' crisis communication management strategies during the 1990s through the study of its CEO's speeches. This analysis explored the company's maneuvers to camouflage controversies in acceptable social expectations. Pairing framing theory with centering resonance analysis, this research found 3 distinct frames: profitable multinational (1994–1996), litigation target (1997–1998), and corporate good citizen (1999–2001). Avoidance of talk about health issues indicated the company's strategic adaptation to a shifting legal and public opinion climate, as it sought to authenticate its right to do business by reframing the notion of corporate responsibility away from healthy products and toward high-price philanthropy.     

ENDOGENOUS DESTRUCTION IN CONFLICT: THEORY AND EXTENSIONS

This article develops a general equilibrium model of conflict to characterize the implications of endogenous destruction for bargaining and fighting. Specifically, we consider the scenario where two contending parties engage in bargaining to avoid fighting when there are direct costs (e.g., arms buildups) and indirect costs (e.g., destruction to consumable resources) of conflict. Without imposing specific functional form restrictions on conflict, production, and destruction technologies, we show their interactions in determining an optimal decision between fighting and bargaining. We find that, under the shadow of conflict, bargaining is costly as the contending parties always allocate more resources to arming for guarding settlement through bargaining than in the event of fighting. In contrast to conventional thinking that bargaining is Pareto superior over fighting, we show conditions under which fighting dominates bargaining as the Nash equilibrium choice. The positive analysis may help explain the general causes of fighting, without resorting to the assumption of incomplete information or misperceptions. (JEL D74, H56, C7)     

Dynamic fairness in repeated bargaining with risk

We study dynamic notions of fairness via an experiment of a two-round bilateral bargaining environment, where the payoff to one player is subject to ex-post risk, while the other player receives a fixed payment, effectively making the player exposed to risk a residual claimant. The ex-post risk not only provides substantive issues for bargaining parties to resolve in the experiment – i.e. what is a fair compensation for the exposure to risk – it also results in the endogenous formation of reference points for the second round due to ex post inequality after the realization of uncertainty in the first round. We find support for a “payback” hypothesis. That is, agreements in the second round significantly differ from the first round in a manner consistent with reducing the inequality that arose due to the initial pie realization.     

Communication, equity and the voluntary provision of a public good by heterogeneous groups

Twenty-four laboratory sessions were conducted to evaluate the roles of communication and group heterogeneity when voluntary contributions determine the level of public good provision by small groups of individuals. Simple heterogeneity has one individual in a group having either greater endowment of resources or a greater preference for the public good than the others. Complex heterogeneity has one individual in a group having both higher endowment and greater preference for the public good. Without communication, members of heterogeneous groups tend to coordinate more on equal contribution shares than predicted by the conventional public goods model but consistent with a model incorporating a preference for equity. The distribution of relative contributions and total payoffs within groups exhibit strong interactions between communication and heterogeneity, leading to less equitable distributions of payoffs as heterogeneity becomes more complex. A model of equity theory helps to organize the results. Results suggest that communication may refocus the objective of group members.     

On competing rewards standards—an experimental study of ultimatum bargaining

In the tradition of earlier experimental studies, this paper introduces competing reward standards by letting parties bargain over the distribution of chips. The monetary equivalents of a chip for the bargaining parties can be equal (no competing rewards) or different (competing rewards). The ultimatum game is used as a tool to learn about reward standards in an asymmetric procedure. A major effect of different monetary chip equivalents is observed only when the proposer has a higher chip value. Results are compared to those reported in [Games Econ. Behav. 13 (1966) 100], who used a different experimental design.     

Priming,Framing, and Position on Corporate Social Responsibility

This study tested the effects of priming, framing, and position on how participants judged a target corporation. The results suggested that the main effects of priming and framing affected participants' judgments of the target corporation's ethical CSR practices and attitudes toward the target corporation negatively. The crucial effects, however, were the interaction effects between framing and participants' positions held toward the target corporation and between priming and framing. The first of these interactions captured the degree to which the impact of framing depended on whether participants held more or less committed positions toward the target corporation. The second captured the degree to which the impact of framing depended on whether participants read the statements that explicitly primed CSR issues.     

Leveling the playing field: Dishonesty in the face of threat

We examined the effects of framing and perceived vulnerability on dishonest behavior in competitive environments. Participants were randomly matched into pairs and took a short multiple-choice test, the relative score of which determined their merit-based payoffs. After learning about the test scores, participants were asked to report them, thus affecting the final payoffs. Framing was varied as participants could either report their own scores or the scores of their counterparts. The presence of threat, or vulnerability to other players’ dishonesty, was varied as either one or both players in a pair could misreport scores. Participants who reported their counterparts’ scores were more likely to report honestly than participants who entered their own score. Participants, whose payoffs were threatened by their opponents’ misreporting, were more likely to cheat to the fullest extent. Furthermore, we found that framing significantly reduced misreporting in the absence, but not in the presence of threat. Results suggest that when actors feel vulnerable to other people’s dishonesty they would often cheat as much as they can in order to “level the playing field”, even when they strongly disapprove of the behavior.     

THE IMPACT OF ENTITLEMENTS AND EQUITY ON COOPERATIVE BARGAINING: AN EXPERIMENT

In some bargaining situations—for example, collaborative policy making and compulsory arbitration—a third party imposes a backstop position that differs from the status quo. Axiomatic models of cooperative bargaining presume that the status quo in such cases will have no effect on the negotiated outcome, especially if it is Pareto inferior to the backstop. Recent literatures on equity and entitlement, however, suggest that the status quo may establish a focal point that acts as an “anchor” in current negotiations, affecting any ultimate agreement. In a two‐party, two‐attribute experiment, in which subjects jointly select from up to 200 options, we find evidence (1) that the status quo matters, perhaps because of “entitlement effects” and (2) that parties prefer egalitarian outcomes to the Nash bargain. (JEL C92, D74, H44, Q58)     

Can strategic message framing mitigate the negative effects of skeptical comments against corporate-social-responsibility communication on social networking sites?

This study connected framing theory with corporate social responsibility (CSR) communication literature to examine whether a CSR message that emphasizes customers’ contribution to CSR efforts can enhance CSR communication and mitigate the negative effects of skeptical comments from other users on social networking sites (SNSs). Specifically, this study examined whether a customer-credit-sharing CSR message, compared to a conventional self-promoting message, better mitigated the effects of skeptical comments from other SNSs users on values-driven motives perceived by customers, customers’ positive attitudes, and behavioral intentions. It also explored whether the effects of strategic framing changed when skeptical comments were made online by friends or strangers. A total of 400 customers participated in an online between-subjects experiment. The results showed that the credit-sharing message better protected perceived values-driven motives and positive attitudes toward the company after the customers were exposed to skeptical comments, regardless of who posted the skeptical comments. Customers who read the credit-sharing message also showed stronger intention to defend the company’s CSR efforts and stronger purchase intention when the skeptical comments came from a friend. More theoretical and practical implications are discussed.     

DOES FACT‐FINDING PROMOTE SETTLEMENT? THEORY AND A TEST

Nonbinding recommendations, such as provided by fact-finders, are shown to significantly increase voluntary settlements in bargaining. Theoretically, it is unclear whether recommendations will increase settlement rates. A recommendation may reduce outcome uncertainty, thereby "chilling" bargaining and increasing dispute rates. On the other hand, a recommendation may give the parties a focal point around which an agreement is made. Which of these effects dominates is a question that we consider using theory and data from controlled bargaining experiments. The data show the dominance of a focal point effect for suggestions, highlighting their potential role in improving dispute settlement procedures.(JEL C78 , C92 , J52 )     

Take-it-or-leave-it offers in negotiations: Behavioral types and endogenous deadlines

This paper studies a reputational bargaining model, and investigates the effects of “exit threat” on negotiators’ equilibrium behaviors. Although it is a purely cheap talk message, exit threat is effective and has two main effects: (1) it renders the final outcome efficient and unique, and (2) shifts the bargaining power towards the negotiator who can make this threat. Setting a deadline for negotiations pressures the opponent and incentivizes her to compromise. However, a deadline that is too early makes the opponent less willing to compromise. Thus, effective deadline is uniquely determined. Last minute agreements occur with a positive probability if negotiators cannot reach an immediate agreement. Frequency of agreement has peaks at the beginning and at the end of negotiations (deadline effect), and is flat otherwise.     

Framing in Mass Communication Research – An Overview and Assessment

This article provides an overview of the use of the framing concept in mass communication research. It focuses on the questions what a frame is and how it is measured, how variation in framing can be explained and what the effects of media framing are. Specific attention will be paid to the sociological origins of framing. The article concludes with recommendations for future research. It argues that a more systematic and conceptually precise measurement of framing is warranted and suggests how the scope of frame‐building and framing‐effects studies can be extended.     

A fair division solution to the problem of redistricting

Redistricting is the political practice of dividing states into electoral districts of equal population in response to decennial census results to ensure equal representation in the legislative body. Where the boundaries are drawn can dramatically alter the number of districts a given political party can win. As a result, a political party which has control over the legislature, can (and does) manipulate the boundaries to win a larger number of districts, thus affecting the balance of power in the US House of Representatives. This work introduces a novel solution to the problem of fairly redistricting a state that is motivated by the ideas of fair division. Instead of trying to ensure fairness by restricting the shape of the possible maps or by assigning the power to draw the map to nonbiased entities, this solution ensures fairness by balancing competing interests against each other. Essentially, it is a simple interactive protocol that presents two parties with the opportunity to achieve their fair representation in a state (where the notion of fairness is rigorously defined) and as a result a balanced electoral map is created.     

Pretrial negotiation, litigation, and procedural rules

We model the civil dispute resolution process as a two-stage game with the parties bargaining to reach a settlement in the first stage and then playing a litigation expenditure game at trial in the second stage. We find that the English rule shifts the settlement away from the interim fair and unbiased settlement in most circumstances. Overall welfare changes are in favor of the party who makes the offer in the pretrial negotiation stage. Lawyers however, always benefit from the English rule, because fee shifting increases the stake of the trial and thus intensifies the use of the legal service.     

PARTY POLITICS AND THE PRICE OF PAYOLA

The literature contains two competing views of the role of political parties: parties are treated either as associations of interest groups supported to the degree that they offer electoral support in the lawmaker's district, or as expressions of the personal ideologies of the lawmakers. In this paper parties are treated as bargaining agents for groups of lawmakers in their dealings with interest groups. Interest groups are depicted buying votes on proposals where those votes are cheapest. Parties are combinations of consistently low-price vote suppliers. The theory has empirical power that discriminates between it and the two competing models.     

Framing European integration in mediated public spheres: an increasing nationalization and contestation of European issues in party political communication?

This article proposes a claims-making analysis of party political communication over Europe in mediated public spheres in France, Ireland, the UK and Spain between 1993 and 2006. It demonstrates that office-seeking parties and especially the representatives of the executive power generally dominate Europeanized debates. In contrast, peripheral parties and other party actors such as party MPs and extra-parliamentary politicians face significant difficulties in obtaining visibility and resonance for their Europeanized frames. The empirical and longitudinal analysis also shows the prevalence of claims directed towards the EU level and of nationalized debates over Europe. Overall, even though critical engagements with Europe have progressed over time, the domination of mainstream parties and party actors in framing European integration and the pro-European consensus between office-seeking parties nevertheless limit the potential for contestation on European matters.     

Intergovernmental negotiation, willingness to compromise, and voter preference reversals

A policy is the outcome of negotiations between two three-party parliamentary states. An election in jurisdiction A determines the composition of the legislature that selects a representative to negotiate an intergovernmental policy agreement with the representative from the legislature of jurisdiction B. Negotiations are modeled using Nash (Econometrica 18(2):155?C162, 1950) bargaining framework. With heterogeneous parties, agreements and electoral outcomes depend on the concavity of the utility functions of negotiators and on the relative location of their ideal policies, i.e., depend on the negotiators relative willingness to compromise. Agreements between the bargainers may not follow the ordering of the parties?? ideal policies. An electoral outcome where support for the center party comes from extreme voters may emerge.